by Robin Degner

Created on: March 29, 2009

I definitely think teens should have credit cards. I also think they need to understand how and when to use them. The best way to teach responsibility for money and credit cards is to have set rules and to enforce them.

When I was 14, my parents gave me a credit card. While most people would discourage this, they did it to teach me responsibility with money and, probably, to help build my personal credit. It was linked to their cards, but in my name. Anything I bought, I had to pay for with my own money.

That only makes sense, right? I was so excited.

Shortly after receiving it, I went shopping with a friend, and she was as excited by the credit Card as I, "You can buy this! And this! And this! You have a credit card!" I remembered the warning my parents' gave me. Frankly, I was terrified of over-spending, them charging me interest and possibly taking my card. I didn't buy anything she suggested. Instead, I bought the things I wanted and knew I would be able to pay for with my babysitting money at the end of the month.

The reason that so many people are in debt today is because they see the credit card as extra money and not what it actually is: money they owe. Negative money. That's not to say credit cards aren't useful and helpful. There are lots of times where you just don't have the cash on hand to pay for something. That's when a credit card should be used, particularly if you know you'll be able to pay for it later, like before the bill is due. Using cards can be a good thing - when you pay for them in a timely manner.

With teens, if they can get a job and pay for their cards, not only will it teach them good spending habits for later, but it will also help improve their credit. Instead of seeing a credit card as a "special" item that they receive for the first time as a college student and promptly rack up $10,000 worth of debt on (seen it happen), they understand that a credit card needs to be respected. Starting sooner, teaches responsibility sooner.

And trust me, if a parent makes a kid pay the interest on a bill they don't pay on time (say, if the card is through the parents' in the kids name - the best way, I think, to do it), the kids will learn. And it's sooo much better to learn that when you're young and haven't made many stupid, life-changing mistakes than it is to learn it when you're getting kicked out of your house because the bank foreclosed on it when you didn't pay your bills.

Learn more about this author, Robin Degner.
Click here to send this author comments or questions.